BIBM79 Organisational Research Proposal on KFC Corporation: Assessment 1 Answer
The KFC Corporation, which is based in Louisville, in Kentucky, is known as the most popular restaurant serving chicken across the world (KFC, 2019). This is the restaurant which is being operated of over 5,200 restaurants within the US, as well as there, are over 15000 restaurants all over the world. This is the restaurant which falls in the category of the Yum Brands. This is the restaurant which suffered a drop in the year 2009, where the revenue of the restaurant was below $11 billion. In the year 1965, brand KFC has reached Britain. But during the year 2005, the company had suffered a lacklustre reputation over the high streets as well as the sales were also slumping (KFC, 2019). Thus, the restaurant suffered some of the customer loyalty issues.
2.1 Main Problem: Customer loyalty issues
At the end of the year 2005, the restaurant suffered some of the customer loyalty issues which created trouble for the industry. The restaurant has taken the shape of the dinosaur over the high streets. Though the brand was famous, now the restaurant has the feeling of date and favour. The restaurant thus does not bear any role regarding the consumers within Britain. The sales of the company were in freefall. The company experienced a drop in market penetration (Wessel et al., 2017). This is the reason behind the company which was suffering a severe decline in the segments of consumer loyalty. This type of poor performance has resulted in the company to experience numerous challenges.
2.2 Sub Problems
The attitude of the nation towards the food has modified in a significant way over the year 2005. The agenda of health has reached critical mass, which has been fermenting during some years. The new launch of Jamie Oliver that is school dinners, as well as the Gillian McKeith, has turned to be household names among the food host and the programmes which are linked with diet. This has the outcome of making the QSR that is the quick-service restaurant brand as the chief enemy for the consumers.
However, the category is being challenged by some of the new competitors with the delivery of some healthy alternatives. The market share of the KFC was being stolen by Subway as well as Pret-a-Manger. The brands like the Burger King and the McDonald's has attempted making healthy food for responding to the pressure of the consumer (Ma, 2018).
There lies some confusion between the projection of the brand and the experiences of the consumer. A much-required injection regarding youth, credibility and energy has been provided by the process of recent advertising. The further challenge of NPD that is the New Product Development has worked as a significant element within the market. The chief audiences for these quick-service restaurants are the families, the young adults and the teens who are responsible for the sales accounting of about 89% (LeBaron et al., 2018).
Faced failure while opting for innovation
In the year 2005, the NPD of the KFC has made the aim of targeting the youth market. Thus, for increasing the frequency of the visits of these customers, the company developed snack items. This is the reason which has made KFC as the place for snacks, but not the destination for meals. There were some attempts performed for serving the healthier food that is non-fried chicken, salads as well as a response was created towards the new competitors along with sub sandwiches. These innovations were failed as well as the sales were cannibalising, as the consumers have got confused with the products (Lankton et al., 2016).
Families stopped visiting KFC stores
The brands were left by the families. KFC was not chosen as the brand by the families and the sales of the company considering the families were deteriorating. The families believed in the concept about the brand that the brand is not there to serve the families but to serve the youth and the teens. This belief of the families has damaged the sales of the company as the spending of the families were three times greater compared to the young adults.
This specific issue needed to be solved immediately. The understanding of the consumer is required to be improved with the launching of some in-depth qualitative study, and the brand was also repositioned with this launch.
Fast Food tastes good: The debate regarding obesity has provided consumers with a different awareness that fast food is not regarded as healthy. While this does not specify about entire abstinence from the food which was favourable to them. The consumers are not to consume fast food for the healthiness but to change their tastes (Juric, Smith & Wilks, 2015).
The taste of KFC is especially good: The taste of the food of KFC is good. The taste of the diet of KFC tastes singular considering the consumers.
3.0 Potential Solution
The Company should initiate some steps for an uprising the sales of the company. These are:
Media should be used for advertising tracking the strategy of NPD for ensuring every group to be targeted effectively. The commercial has utilised insightful truths considering the family life of every day for the illustration of the relevance of new KFC products for the establishment of the feeling of the mainstream, family brand and is accessible. The products of the KFC are made unique with more appealing photography of the food (Fisher, Matthews & Gibbons, 2016).
3.2 Other channels
The company should have the target of informing more customers regarding the provenance as well as the nutritional details through numerous actions. Like, the company has updated the website with all information of the content as well as the in-store leaflets regarding the production of food sourcing.
3.3 The experience of the store
The stores will work with new energy and the pride of the brand. The experience of the customers should be joyful. The staffs of the stores are provided with training regarding the new food products and about teamwork would enhance the store sales with a tangible impact (Filtenborg, Gaardboe & Sigsgaard-Rasmussen, 2017). More emphasis on social media platforms detailing valuable information about the stores could also add value to consumer loyalty.
3.4 Rewarding the consumers
The company can start rewarding the consumers with discount coupons upon purchase of their products. Lucky draws can also generate interest among consumers. On special occasions, complimentary dishes can also make interest amongst the consumers. The consumer can acquire credit points while purchasing products and then use these points for various facilities.
3.5 Creating brand awareness
The brand has stood out of the competitive crowd. When further fast food centres were experiencing loss, the KFC stood erect comparing with the two major competitors like the Burger King and McDonald's. The company has also noticed a new interest in consumers. The company should reach a high level of brand awareness. The proud tone of KFC has been reflecting within the voice of the consumers. The penetration of KFC among families should be increased radically.
4.0 Theories for supporting the customer loyalty programme and customer satisfaction
There are numerous theories for supporting the loyalty programme of the customers and for attaining customer satisfaction.
4.1The Assimilation theory
This is the theory which is based on the theory of Festinger. It is positioned by the dissonance theory that; some comparison is being performed by the consumers among the product expectation and the perceived performance of the product (Wessel et al., 2017). In this view of the consumer that is the post-usage evaluation was being introduced within the satisfaction literature, which is attained in the form of assimilation theory. As per Anderson, the dissonance is avoided by the customers with the adjustment of the perceptions regarding a product for bringing the product for fulfilling the needs of the customers. Tensions regarding the discrepancy among the expectations as well as the product performance are reduced by the consumers with distorting the expectations. This is performed to coincide the customers with the product performance which is perceived as well as by the raising of the level of satisfaction. This is the theory which predicts about the connection among the comfort and the expectation, while this theory never specifies about the disconfirmation within an expectation has either forwarded towards satisfaction or else towards dissatisfaction. This is the theory which also predicts about the motivation of the consumers for adjusting either their expectations or else altering the perceptions considering the product performance (De Bruyn & Prokopec, 2017). Thus, this is to be believed that, before the introduction of the evaluative process along with the cynical expectation of the consumer, dissatisfaction never happens.
4.2 Contrast Theory
Hovland, Sheriff and Harvey have initially introduced the contrast theory. The contrast theory is being discussed by some of the scholars as the tendency of magnifying the tendency of the sole attitude of an individual and the opinion statement attitudes (De Bruyn & Prokopec, 2017). This is the theory which has posted an alternative view regarding the post-usage evaluation process of a consumer which is explained within the assimilation theory. As per the contrast theory, any experience discrepancy which is derived from the expectations is exaggerated towards the discrepancy direction. This is the theory which predicts the reaction of the consumer rather than the reduction of dissonance. The variation among the performance of the service or the product and the expectation is being magnified by the consumer.
4.3 Negativity theory
This is the theory which was introduced by Aronson and Carlsmith. It is being suggested by them that, any performance discrepancy which is derived from the expectations, will occur for the disruption of the individual. This, as a result, produces negative energy. The disconfirmation process is the source of the negative theory (Juric, Smith & Wilks, 2015). It is being stated by the negative theory that, when the expectations of the customers are held strongly, then, there takes a negative response of the consumer towards the segment of any disconfirmation. Consequently, the occurrence of dissatisfaction happens with less perceived performance than the expectations as well as during the exceeding of the perceived performance expectations.
4.4 Disconfirmation theory
This the theory which argues about the relation of the satisfaction with the size as well as the direction considering the disconfirmation experience which has taken place as the outcome of the performance of the comparing service against the expectations (Filtenborg, Gaardboe & Sigsgaard-Rasmussen, 2017). This theory also specifies the fulfilment response of the guest is known as satisfaction. This is regarded as the judgement considering the feature of the product and the feature of the service. This has provided a level of pleasure considering the consumption-related fulfilment considering the levels of the over as well as under-fulfilment.
Figure: Disconfirmation Theory Model
(Source: Lankton et al., 2016)
These are the theories which have driven the loyalty within the customers. The loyalty of the customers is being counted as an invaluable commodity in the segment of the business owners.
The younger customers are less inhibiting towards customer loyalty while the older customers are much loyal to any businesses. The programmes of the loyalty customers assist the businesses for targeting their efforts within the market with the collection of more data over the trends of consumer shopping. Whatever data is collected from the loyalty programmes assists the businesses regarding the structure of the price and regarding the best product lines.
The interest of the customers is being targeted with some special loyalty programmes and customising some special offers. Any of the marketing, whoever is adopting a loyalty programme are required to be careful regarding the communication process which is being performed by them with the customers (Davis et al., 2018).
Customer satisfaction happens when the expectation of the customer is fulfilled and are exceeded. The expectation varies among numerous people.
The Restaurateurs are required to build a strong relationship with their customers for thriving business. The building of the customer loyalty programme is rather counted as a difficult task.